(Provisional Translation)
June 27, 2001
Financial Services Agency

An administrative action against Société Générale Securities (North Pacific) Ltd., Tokyo Branch

1. The Securities and Exchange Surveillance Commission conducted the inspection of Société Générale Securities (North Pacific) Ltd., Tokyo Branch ("the Branch" hereafter), found the following legal violations and sent the recommendation to the Commissioner of the Financial Services Agency (FSA) to take disciplinary action against the Branch on June 19, 2001.
   
   Solicitation with promise of special profit

(1)

From January to June 1998, with the involvement of the former Vice Manager of the Branch, the Branch solicited several corporate customers with promises to avoid realizing a redemption loss of a note which the customers purchased before, by a scheme where the conditions of the note would be altered mainly in order to defer its redemption loss. In fact the value of the note just before redemption was almost nothing.

(2)

From March 1995 to June 1998, with the involvement of the former General Manager of the Branch, the Branch solicited a customer (a securities investment advisor) with a promise to provide rebate towards orders from the customer under the pretext of advisory fee.

Such conducts were found to constitute the Article 2-2 of the former Ministerial Ordinance concerning Rules and Regulations Governing the Sound Management of Securities Companies.

2. On the basis of the above findings, the FSA issued the following orders against the Branch.

(1)	Suspend all the business operations of the Structured Products Department and the Financial Engineering Department in the Branch from July 4 to July 6, 2001 excluding certain business for settlements of transactions with customers without solicitation.
(2)	Suspend the brokerage businesses related to equities in the Branch from July 4 to July 6, 2001 excluding brokerage business related to deposited equities by customers without solicitation.
(3)	Strengthen the internal control system, secure strict compliance, make preventive measures against recurrence of the above mentioned violations, and clarify locus of responsibility.